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LABOR & EMPLOYMENT LAW — 7/14/08

Missouri governor signs comprehensive immigration bill into law

Missouri Governor Matt Blunt (R) signed the state’s comprehensive immigration reform bill (H.R. 1549) into law on July 7, 2008. In a press release issued by Blunt’s office, he characterized the bill’s provisions “as some of the strongest legislation in the country to fight illegal immigration.” The bill, a conference committee substitute, passed in the state legislature May 16. The Pew Hispanic Center estimates that 35,000 to 65,000 illegal immigrants live in Missouri.

Among its employment provisions, the bill requires state agencies, local governments and businesses that contract with the state (in excess of $5,000) or that receive tax credits to participate in E-Verify. E-Verify is the voluntary web-based system operated by the Department of Homeland Security’s US Citizenship and Immigration Services bureau in partnership with the Social Security Administration that allows participating employers to electronically verify the employment eligibility of their newly hired employees. More information on E-Verify can be found at: http://www.dhs.gov/ximgtn/programs/gc_1185221678150.shtm. Participation in E-Verify is an affirmative defense that the agency or contractor has not knowingly employed, recruited, hired for employment, or continued to employ an unauthorized alien to perform work within the state of Missouri. The law also encourages private employers to use E-Verify as well by offering it as a defense if the employer is found to employ undocumented workers.

All employers who employ undocumented workers are subject to the suspension of their business permits and licenses or exemptions. If an employer is found to have knowingly hired an undocumented worker, its licenses can be suspended for 14 days. Permits, licenses and exemptions will be reinstated for entities who comply at the end of the fourteen day period by: (1) terminating the undocumented worker; or (2) requesting a second verification from the federal government, signing a sworn affidavit stating that the violation has ended and submitting documentation confirming the entity is enrolled in a federal work authorization program. A second violation results in the suspension of the employer’s business permits and licenses or exemptions for one year. Subsequent violations can result in permanent revocation of the employer’s applicable licenses. State contractors may have their contracts voided and will be barred from contracting with the state for three years. Subsequent violations would result in a void contract and a permanent bar from contracting with the state. The state may withhold up to 25 percent of the total amount due to the business entity upon termination of the contract.

In addition, failing to provide identity information on employees within 15 business days after receipt of a request from the attorney general will result in the suspension of a company’s applicable local licenses, permits and exemptions until the information is supplied.

The bill’s employment provisions take effect January 1, 2009.

The bill also bars employers with five or more employees performing public works from knowingly misclassifying employees as independent contractors. The attorney general would have the power to investigate alleged misclassifications. Injunctions may be sought and employers would be charged $50 per day per misclassified worker up to a maximum of $50,000 for violations. When workers are contractors, employers do not have to pay withholding taxes or provide other benefits. The bill can be found at: http://www.house.mo.gov/billtracking/bills081/bills/hb1549.htm.